Airlines stable amid hard times Cost cutting, routes withdrawal liable

Woleshadarenews investigation shows that the constant fear of airlines closing shop is no longer there, as many of the airlines are repositioning their operations and cutting loss making routes, particularly the West coast routes.

Aviation consultant and former Assistant Secretary-General of Airline Operators of Nigeria (AON), Alhaji Mohammed Tukur, told our correspondent that carriers had to do a re-think by subjecting their operations to serious scrutiny in a bid to remain afloat.

He said it doesn’t make sense for them to continue to waste money on routes that are not profitable, adding that the concentration on the domestic market could be more profitable if the airlines use the right equipment and cut down drastically extraneous costs.

Even the international routes such as London and the United States hitherto operated by Arik and Medview Airlines have been suspended because the operations crippled their services and almost brought them to their kneels.

The Single African Air Transport Market (SAATM), which was ratified by the African Union early last year created open sky for 23 African countries that are already signatories to the policy.

The implication of this policy, it was learnt, is that the airlines of these 23 countries can freely enter and exit these member-countries without hindrance.

Many of Nigerian carriers that hitherto dominated the West Coast routes have withdrawn their services because of stiff competition posed by predatory airlines such as Ethiopian Airlines, African World Airlines (AWA), ASKY and many other national or flag carriers of airlines in the region.

Nigeria contributes more than 55 per cent of the total passenger traffic on the West and Central Africa, but now it is other African airlines that are making money from those routes because the host countries exempt their airlines from many of the charges which they level on Nigerian operators.

Dana, Medview Airline, have ceased operations to West Coast destinations, while Arik Air has drastically reduced its operations in the West and Central African destinations.

The airline, it was learnt, no longer operate to Gabon, Banjul, Abidjan, Freetown, and Douala, and has restricted its destinations to Accra, Ghana, Luanda, Angola, Dakar, Senegal and Monrovia, Liberia.

Owner of Nigeria’s biggest airline by aircraft size and operation, Air Peace, Mr. Allen Onyema, recently told journalists that the routes were no longer lucrative for the carriers.

He disclosed that his airline is bleeding from over N500 million loses operating to West Coast, adding that it amounts to a waste as he pumps money made on the domestic market on the loss making routes.

“We lose over N500 million monthly to the West Coast,” he said. “This is the money we make from domestic operations. Except this SAATM is a re-addressed, Nigerian airline will collapse. Unless government intervenes, we may leave the routes to these foreign airlines.”

“This is because if you continue operating the West and Central routes, it will affect your revenue base on the domestic scene and you will crumble. That is why most Nigerian airlines could not succeed on those destinations.”

He added that if the federal government supports domestic airlines as other countries, it would have reciprocated the high charges by also charging those African carriers the same amount they charge their Nigerian counterparts.

It was observed apart from Air Peace, which is in the business of acquiring airplanes, aircraft fleet are seriously depreciating. A visit to the domestic wing of the Lagos airport paints a worrying sign for the aviation industry in the country.

Many disused aircraft are littering the tarmac and other sensitive areas of the apron. Despite that, the airlines have maintained their operations amid huge struggle as no airline has closed shops in the past five years, a rear occurrence.

The wrong use of equipment has equally affected many carriers who have their aircraft grounded because of huge costs of maintaining their Boeing airplanes.

With the skyrocketing cost of aviation fuel, airlines are said to be spending more money on operation cost and may not save money to pay for high maintenance checks such as C-Checks, which could cost as much as $600,000 or more.